Save your cookie preferences

We use cookies to remember your site preferences, record your referrer and improve the performance of our site. For more information, see our cookie policy.

Please select an option below and 'Save' your preferences.

No cookies. Without any cookies our websites can't remember your site preferences (currency, weight units, markets, referrer, etc.) for your next visit. Any cookies already dropped will be deleted at the end of your browsing session.

BullionVault cookies only. We use these cookies to record your site preferences (currency, weight units, markets, referrer, etc.) for your next visit.

BullionVault cookies and third-party cookies. Also, allow our use of cookies from well-known third parties such as Google, Facebook, Bing and YouTube. These help us understand how visitors use our websites so we can improve them.

You can update your cookie preferences at any time from the 'Cookies' link in the footer.

We use cookies (including third-party cookies such as Google) to remember your site preferences and to help us understand how visitors use our sites so we can improve them. To learn more, please see our privacy policy and our cookie policy.

To agree to our use of cookies, click 'Accept' or choose 'Options' to set your preferences by cookie type.

Gold & Silver Buying Jumps to 3-Year High

LAST MONTH's volatility in gold and silver prices saw the largest number of private investors buy physical metal in almost 3 years,
writes Adrian Ash at BullionVault.

Starting May at 15-month highs in US Dollar terms, both gold and silver prices then fell hard (down 7.0% and 10.1% respectively by month's end) but still recorded the highest monthly averages in well over a year (since August 2014 for gold, and since January 2015 for silver).

Seizing end-May's steep discounts from its earlier highs, the number of investors starting or growing their personal holdings via BullionVault – the
low-cost, award-winning metals exchange online – hit the highest levels in both gold and silver since the price crash of Spring 2013 ended that June, rising more than 35% compared to the previous 12-month average.

In contrast, the number of private investors selling or reducing their precious metals holdings in May fell 15% against the previous 12-month average, down to the fewest since December 2015 – when gold and silver prices both dropped to new 6-year lows against the US Dollar.

BullionVault's Gold Investor Index measures the balance of investors starting or adding to their holdings over those reducing them. A reading of 50.0 would signal a perfect balance between the number of net buyers and net sellers across the month.

And thanks to that surge in buying and drop in selling, the Gold Investor Index jumped from 53.5 in April to 55.8 in May, the highest level since April 2013.

The Silver Investor Index also rose sharply, reaching an 11-month high of 56.1 from the 50.8 reading given in April.

By weight, customers of BullionVault added more than a quarter-tonne of gold. That took
total client holdings to a new record of more than 35 tonnes, larger than the central bank gold reserves of Peru and all stored in the user's choice of London, New York, Singapore, Toronto or Zurich.

BullionVault users also added 20 tonnes of silver, the heaviest 1-month addition since the 21-tonne record of January 2011, taking total holdings to a new peak of 583 tonnes.

Weak US employment data mean there's
no chance of a June rate rise from the Federal Reserve, and little chance of a rise in July. Growing fears around what a Brexit vote will do to asset prices in a fortnight's time is also buoying demand for physical gold.

So far in 2016, the number of UK investors starting to use BullionVault for the first time has jumped 59% ahead of January-to-May last year, compared with a 34% rise across our next 9 largest markets overseas.

Adrian Ash is director of research at BullionVault, the physical gold and silver market for private investors online. Formerly head of editorial at London's top publisher of private-investment advice, he was City correspondent for The Daily Reckoning from 2003 to 2008, and is now a regular contributor to many leading analysis sites including Forbes and a regular guest on BBC national and international radio and television news. Adrian's views on the gold market have been sought by the Financial Times and Economist magazine in London; CNBC, Bloomberg and TheStreet.com in New York; Germany's Der Stern; Italy's Il Sole 24 Ore, and many other respected finance publications.

Please Note: All articles published here are to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it. Please review our Terms & Conditions for accessing Gold News, RSS links are shown there.